Rite Aid — Q4 FY2018 Earnings Presentation
22 slides from Rite Aid's earnings presentation, Apr 12, 2018
Slide 1: Q4 Fiscal 2018 Supplemental Information
PHARMACY With us, its personal. 4™4 QUARTER FISCAL 2018 SUPPLEMENTAL INFORMATION April 12, 2018
Slide 2: Cautionary Statement Regarding Forward Looking Statements
Cautionary Statement Regarding Forward Looking Statements Statements in this presentation that are not historical, are forward - looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 . Such statements include, but are not limited to, s
Slide 3: Additional Information and Where to Find It
Additional Information and Where to Find It In connection with the proposed merger involving Rite Aid and Albertsons, Rite Aid and Albertsons have prepared and Albertsons has filed with the SEC on April 6 , 2018 a registration statement on Form S - 4 that includes a proxy statement of Rite Aid that
Slide 4: Cautionary Note Regarding Pro Forma Information
Cautionary Note Regarding Pro Forma Information : The following presentation provides certain pro forma information regarding the impact of Rite Aid’s proposed sale of stores and assets to Walgreens Boots Alliance, Inc . on Rite Aid’s results of operations and capital structure . The pro forma infor
Slide 5: Non-GAAP Financial Measures
Non - GAAP Financial Measures The following presentation includes the non - GAAP financial measures, Adjusted EBITDA, Adjusted Net Income (Loss), Adjusted Net Income (Loss) per Diluted Share and Pro Forma Adjusted EBITDA . Rite Aid defines Adjusted EBITDA as net income (loss) excluding the impact of
Slide 6: Q4 Fiscal 2018 Summary
Revenue 5,394.3$ 5,903.4$ Net Loss (483.7)$ (25.1)$ Net Loss per Diluted Share (0.46)$ (0.02)$ Adjusted Net (Loss)/Income (10.3)$ 19.8$ Adjusted Net (Loss)/Income per Diluted Share (0.01)$ 0.02$ Adjusted EBITDA 157.4$ 2.92% 167.6$ 2.84% Pro Forma Adjusted EBITDA 173.2$ 180.8$ 13 Weeks Ended March 3,
Slide 7: Q4 Fiscal 2018 Summary - Total Company
Net Income/(Loss) 767.1$ (21.1)$ Net Income/(Loss) per Diluted Share 0.73$ (0.02)$ Adjusted EBITDA 197.9$ 2.85% 264.3$ 3.09% 13 Weeks Ended March 3, 2018 14 Weeks Ended March 4, 2017 Q4 - Fiscal 2018 Summary ($ in millions, except per share amounts) TOTAL COMPANY
Slide 8: Reconciliation of Net Loss to Adjusted EBITDA
Q4 - Fiscal 2018 Reconciliation of Net Loss to Adjusted EBITDA ($ in thousands) 13 Weeks Ended March 3, 2018 14 Weeks Ended March 4, 2017 Net Loss - Continuing Operations (483,673)$ (25,054)$ Adjustments: Interest expense 50,603 53,391 Income tax expense 216,719 48,262 Depreciation and amortization
Slide 9: Reconciliation of Net Loss to Adjusted Net Income
Q4 - Fiscal 2018 Reconciliation of Net Loss to Adjusted Net Income ($ in thousands, except per share amounts) 13 Weeks Ended March 3, 2018 14 Weeks Ended March 4, 2017 Net Loss $ (483,673) $ (25,054) Add back - Income tax expense 216,719 48,262 (Loss)/Income before income taxes (266,954)$ 23,208$ Ad
Slide 10: Q4 Fiscal 2018 Summary - Retail Pharmacy Segment
Revenue 3,999.4$ 4,447.2$ Adjusted EBITDA Gross Profit (1) 1,126.6$ 28.17% 1,218.5$ 27.40% Adjusted EBITDA SG&A (1) 1,002.5$ 25.07% 1,095.5$ 24.63% Adjusted EBITDA 124.1$ 3.10% 123.0$ 2.76% 13 Weeks Ended March 3, 2018 14 Weeks Ended March 4, 2017 Q4 - Fiscal 2018 Summary RETAIL PHARMACY SEGMENT ($
Slide 11: Q4 Fiscal 2018 Summary - Retail Pharmacy Segment
Q4 - Fiscal 2018 Summary RETAIL PHARMACY SEGMENT Retail Pharmacy Segment revenue decreased $447.8 million or 10.1%. Excluding $312.2 million of revenues related to the extra week in Fiscal 2017, Retail Pharmacy Segment revenue decreased 3.3% due to a 1.8% decrease in comparable script growth and a 0
Slide 12: Reconciliation of Adjusted EBITDA Gross Profit
Reconciliation of Adjusted EBITDA Gross Profit RETAIL PHARMACY SEGMENT ($ in thousands) 13 Weeks Ended March 3, 2018 14 Weeks Ended March 4, 2017 Revenues 3,999,430$ 4,447,175$ Gross Profit 1,169,103 1,245,709 Addback: LIFO credit (49,220) (28,987) Customer loyalty card program revenue deferral 2,56
Slide 13: Reconciliation of Adjusted EBITDA SG&A
Reconciliation of Adjusted EBITDA SG&A RETAIL PHARMACY SEGMENT ($ in thousands) 13 Weeks Ended March 3, 2018 14 Weeks Ended March 4, 2017 Total Revenues 3,999,430$ 4,447,175$ Selling, general and administrative expenses 1,093,258 1,171,840 Less: Depreciation and amortization (SG&A portion only) 69,8
Slide 14: Pharmacy Services Segment Results
Pharmacy Services Segment Results ($ in millions) 13 Weeks Ended March 3, 2018 14 Weeks Ended March 4, 2017 Revenues 1,445.5$ 1,510.8$ Cost of Revenues 1,344.8 1,407.5 Gross Profit 100.7 103.3 Selling, General and Administrative Expense (88.7) (81.3) Addback: Depreciation and Amortization 21.3 22.6
Slide 15: Q4 FY 2018 Summary - Pharmacy Services Segment
Q4 - FY 2018 Summary PHARMACY SERVICES SEGMENT Revenues decreased $65.3 million, primarily due to a decline in the commercial business and changes in composition of Medicare Part D membership. Adjusted EBITDA decreased $11.3 million, primarily due to the reduction in revenue.
Slide 16: Comparable Store Sales Growth
FY 18 FY 16 FY 17 FRONT END SALES RX SALES SCRIPT COUNT 0.9% 0.8% 0.7% 0.1% 1.5% 0.5% 0.1% 0.1% - 1.1% - 0.8% - 0.5% - 0.6% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 5.0% 3.3% 1.8% 0.5% 0.4% - 3.4% - 4.0% - 4.7% - 5.5% - 4.9% - 3.5% - 2.3% Comparable Store Sales Growth CONTINUING OPERATIONS 3.6% 2.0% 2.0%
Slide 17: Capitalization Table
Capitalization Table ($ in thousands) Note: Debt in the capitalization table is shown net of unamortized debt issuance costs. March 3, 2018 March 4, 2017 Secured Debt: Senior secured revolving credit facility due January 2020 (16,103)$ 2,405,082$ Tranche 1 Term Loan (second lien) due August 2020 - 4
Slide 18: Pro Forma Leverage Ratio
Pro Forma Leverage Ratio ($ in thousands) March 3, 2018 Gross Debt w/o Debt Issuance Costs 3,445,906$ Less: cash and cash equivalents 447,334 Net Debt 2,998,572$ Adjusted EBITDA Retail Pharmacy Segment 475,960 Pharmacy Services Segment 171,534 Adjusted EBITDA 647,494$ Leverage Ratio 4.63 CONTINUING
Slide 19: Store Profile
Store Profile Rite Aid States & Store Count Rite Aid Distribution Centers As of 3/3/2018 139 14 73 1 570 3 269 214 8 529 78 6 62 MA 10 CT 34 NJ 133 DE 42 . 321 MD 44
Slide 20: FY 2019 Guidance
FY 2019 Guidance ($ in thousands, except per share amounts) Low High Total revenues 21,700,000$ 22,100,000$ Same store sales 0.00% 1.00% Gross capital expenditures 250,000$ 250,000$ Reconciliation of net loss to adjusted EBITDA: Net loss (95,000)$ (40,000)$ Adjustments: Interest expense 210,000 210,
Slide 21: FY 2019 Guidance (cont.)
FY 2019 Guidance (cont.) ($ in thousands, except per share amounts) Low High Net loss $ (95,000) $ (40,000) Add back - Income tax benefit (15,000) (10,000) Loss before income taxes (110,000) (50,000) Adjustments: Amortization of EnvisionRx intangible assets 85,000 85,000 LIFO charge 35,000 35,000 Lo
Slide 22: Rite Aid Pharmacy
_ ,AID PHARMACY With us, its personal.